Rainbow Scalping System

Rainbow Scalping System is based on WMAs. See how to build Rainbow.

Select Average Price Line chart and change the line color to Red (No candlesticks).
>> Plot the following WMAs with colors on a 5 sec  xtick chartor higher Time Frame :

WMAs 1, 6, 12, 18, 24 (Red)

WMAs 30, 36, 42 (Orange)
WMAs 48, 54, 60 (Yellow)
WMAs 66,72,78 (Green)
WMAs 84, 90, 96 (Cyan)
WMAs 102, 108, 114 (Blue)
WMAs 120, 126, 132, 138, 144, 150 (Purple)
WMAs 156 (White)
>> Adjust the zoom level for Time line (v-line) to show the chart in 5 min interval.
>> Adjust the zoom level for Price line (h-line) to show the chart with 5 or 10 pips interval.
>> Select your currency pair (here EUR/JPY)
>> Select your timeframe (here 5 sec)

Scalpers in this example started their day around 21:00 EST. If you see the above chart an aggressive scalper will spot the down move when the spine hit the v-line (time line) around 21:55 and flame (red group) already hit the h-line (price line) at 158.30. Aggressive scalper will jump in when the flame hits 158.30 and grab a 10 pips when the flame hits the 158.20. As you can see aggressive
scalpers will follow the flame and h-line.

A conservative scalper will stay calm and wait for the up move taking contrarian approach. He may wait for the spine - which is the purple group here – moves above the white line and enter when he sees the flame cut the hline or breach the previous flame resistance. Conservative scalper jump in
around 158.25, or little bit later and ride the wave until the flame hits the 158.35 to grab a 10 pips.
In both scenarios our Rainbow scalpers cashed in the daily bread 6pips. In both scenarios, Rainbow scalpers were following the Flame, Spine, H-line, V-line.
Flame - is the red group that forces you to follow the price.
Spine - can be Purple group or Yellow group depending on the development stage of the Rainbow. White line gives you a guidance in identifying the spine. It also shows you the trend strength and the direction (from the angle of cutting the V-line).
H-line – shows you the rounded price numbers in your chart. You can zoom in/out the chart to adjust the scale to show you a 5 pips or 10 pips interval, so that it will help you to manage the risk easily.
V-line – shows you the time in your chart. You can zoom in/out the chart to adjust the scale to show you 5 min or 10 min time interval, so that it will help you to manage the active market time and execute time based exits. As I mentioned earlier, we can not see the above moves easily from the other timeframes. Check out the following example screenshots and you can decide on your timeframe based on your risk profile. I strongly recommend 5 sec and maximum 30 sec chart. When you see the moves in 1 min or 5 min chart, our Rainbow scalpers above have already cashed in 10 pips. Every single move must pass through those who stay in 5 sec chart.

The preservation of capital should be your utmost priority - remember the “don’t lose money” rules. This is why in addition to our 06 pips daily profit target there are several other rules for exits. Your absolute maximum stop-loss should be 18 pips from your entry. It should be noted that the closer the stop is to your entry price the more likely it is to If the initial move of the market in any session start is UP look for Sell Opportunity. If the initial move of the market is DOWN look for Buy Opportunity.
>> We buy and sell using Rainbow patterns and wave changes. Use Flame, Spine, H-line and V-line as guides to take high probability scalps.
>> As soon as the Rainbow wave turns showing the end of a previous trend, enter into the trade. New scalpers can wait for the spine to cut the next major round market price using h-line or when  Rainbow breaches any previous support/resistance level until they master the  Rainbow waves.
Use a lot of screen time to avoid fake moves and when you detect the fake move just simply get out.

Take a fixed profit target of 06 pips, or take profit on  Rainbow when it hits the next major round market price - h-line or previous support/resistance level or ride the wave and wait for the  Rainbow wave change direction for maximum profit.
>> Use the 06-minute rule as an optional exit strategy by using v-line; Get out of the trade if the price freezes for longer time than expected or if you are not in profit (v-line will help here). Always remember an absolute maximum of 18 pips stop-loss (h-line will help here). That is it - simple scalping rules for entry and exit and whether to buy or sell, when to enter and when to exit. With some screen time you will trade with much more confidence. Always keep the take-profit and stop-loss in your head (to avoid any manipulation from the broker or market maker). You must be a little careful scalping when the market has not traded for a long period such as weekend and over national holidays as there is a chance that the market has got a great deal of International news to catch up on and the first day back may be a one-way day with little or no reversal. If you identify
the direction, jump in and ride the wave and harvest the pips for rainy days. You should also take note of news releases made in the first hour of scalping.

Below the link for download Rainbow Scalping System for Metatrader 4

https://drive.google.com/file/d/0Bwjv2Pbf48itcmxYUklMNVVOWGc/view?usp=sharing